High-end manufacturing key to economy: McNamee

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CSL
chief executive
Brian McNamee
said Australia should migrate to high-end manufacturing as it grapples with a fading mining boom, saying higher education must be a priority.

Dr McNamee, one of the most successful and best-regarded chief executives, said Australia needed to become more competitive and productive if it was to successfully transition away from a resources-based economy.

“As the mining boom wears off we must return to a competitiveness, productivity focus and complement that with innovation, or else ultimately we’ll have declining living standards," Dr McNamee told Financial Review Sunday on Channel Nine.

“High-end manufacturing has to be where you migrate to.

Outgoing CSL chief executive McNamee says Australia needs to become more competitive and productive if it is to successfully transition away from a resources-based economy.
Photo: Michele Mossop

“The reality is high-end manufacturing needs and sophisticated work requires postgraduate work. We need sophisticated engineers, PHDs, scientists as well. Anything that takes money away from the higher end of education in my view is a mistake."

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Dr McNamee also urged a change in government policy around industrial relations.

“I have to say I feel Australia has not done as well with industrial relations over the last few years," he said.

“Fundamentally it’s an environment where it’s more difficult to talk directly to your workforce, because there’s the intermediaries of the unions who want to use the bailout option of Fair Work Australia continuously.

“It’s a filter which in our view is unhelpful."

Dr McNamee is stepping down as chief executive of the blood plasma and vaccine manufacturer at the end of the month, with Paul Perreault to take over the reins.

Dr McNamee, who has expanded the company’s revenue more than 30 times to $5 billion dollars since taking on the top job in 1990, has reassured shareholders that CSL can continue to grow.

“We have a really deep pipeline of new products coming through the marketplace, we are very happy with where we are in the cost curve globally.

“We have underlying demand for our products, we are expanding geographically ... all around the world – Eastern Europe, Latin America, Central America.

“Our Chinese business is growing very well also. So we are optimistic about our future," he said.

“I was very keen to leave the company in good shape and leave it in really good hands and I am confident I have done that."

UBS healthcare analyst Andrew Goodsall said Mr Perreault’s biggest challenge would be to find commercial success in a new market segment for treatments for haemophiliacs, where CSL is just a distributor at the moment.

“They know the market but the main challenge for Paul is to commercialise and bring about commercial success. The upside there is quite substantial, it’s an $8 billion market place," Mr Goodsall said.